Company fleet switches will drive up EV numbers on our roads

While sales of company cars do not in Ireland make up as big a chunk of overall new car sales as in some other markets, company fleets still end up contributing big numbers to the end-of-year total. Indeed, in some years company car sales have accounted for as much as a third of the cars sold and registered.

Which should mean that company car sales ought to be driving electric car sales, largely because the restructuring of the benefit in kind (BIK) taxation system hugely favours electric models when it comes to an individual’s tax bill. Yet, they’re not yet – or, at least, not quite.

A surge in electric car company sales can be expected, though, especially as those higher BIK costs for petrol and diesel models start to bite, and even more so once the Government enacts upcoming legislation to end the ability of companies to claim back VAT on diesel fuel.

Simon Madden, the marketing director of Nifti Business, a company car fleet supplier, says: “Our share of fully electric cars is still relatively small out of our overall fleet but it’s growing rapidly. I think that a lot of companies, especially since 2020 and Covid, have started to take sustainability really, really seriously.

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“It’s a very quick and easy way to have a major impact on your corporate CO2 emissions. If you’re a company with 10 or 20, or even 30 or 40 vehicles in a fleet, and they’re out on the road a lot, then you can do the maths fairly easily and I would struggle to think of anything else that would have an impact as quickly.”

While there are obvious financial benefits in switching a company fleet to electric power – those BIK bills, the capital depreciation allowances made for EVs – Madden sees other advantages.

“It’s about future-proofing your business, from a point of view of being investable,” he says. “It’s good business to be seen to be doing everything you can to reduce your carbon footprint.”

One might assume that it would be larger companies, with greater resources, that are investing faster in electric fleets but Madden says that in fact it is small-to-medium companies that are at the forefront of EV-switching right now. The bigger companies’ bigger fleets mean they are taking a more cautious approach, he says.

Once those big fleets really start to gear up for the electric switch, the number of electric cars on Irish roads will likely increase rapidly. Which begs the question: where are they all going to charge?

It is reckoned that Ireland will need 100,000 public charging points by 2030, yet at the moment we only have a little over 2,000. If company car users start to hit the roads with battery power will there be sufficient plugs to go around? According to ESB’s ecars electric vehicle department, yes.

“Our public EV charging network has been able to handle the increased EV charging load thus far and we will be continuing to invest to stay ahead of demand and to build out more infrastructure as EV numbers continue to increase over the next decade,” says an ecars spokesperson.

“We have observed an increase in the volume of fleet users, particularly in 2023 and have factored this into our forecasts.”

However, one choke point could be home chargers. ESB – and most other EV market stakeholders – expects that around 80 per cent of charging will be done at home, where you can top up your battery overnight when electricity will be at its cheapest. But there have been reports of significant delays for some consumers in getting home charging points fitted and turned on.

Some have had to wait months to get a charger, although charging solutions supplier Ohme says the average wait time for a home installation is two weeks.

Even then, ESB reckons that the improving technology of electric cars potentially renders this moot.

“Given that many of the latest vehicles now have a range of over 400km and growing, and the average journey is less than 10km, according to the National Travel Survey 2022, it means that drivers will mainly need access to charging for longer journeys or to charge their vehicle once every week or possibly two weeks if they do not have access to off-street parking,” says its spokesperson.

However, that would mean more expensive charging by far than charging at home – the oft-promised reductions in public charging prices have still not materialised – and it doesn’t account for the hassle and time consumption of going and sitting on a public charger.

Whether it’s home or public charging, we are going to need an awful lot more plug points – and soon – especially once company car buyers start to make the EV switch en masse.